Calpine Corp. said Friday it has entered into two agreements to sell its Rocky Mountain natural gas reserves in the Colorado Piceance Basin and New Mexico San Juan Basin for approximately $223 million.
Two undisclosed U.S. gas companies will acquire the assets for an estimated $140 million and $83 million, respectively, less adjustments to reflect a July 1 effective date, the San Jose, CA-based energy company said. Combined with the proceeds from its recently announced Canadian gas reserves sale, Calpine noted it will raise nearly $850 million.
The Rocky Mountain assets up for sale represent approximately 120 Bcfe of proved gas reserves, producing about a net 16.3 MMcfe/d of gas, the company said. Net proceeds from the sales will be used to reduce the amount outstanding under Calpine’s existing $500 million first lien indebtedness, it noted.
Calpine, a leading North American power company, said it expects to close the transactions by early September pending regulatory approvals and other conditions of closing.
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